Home Ownership Trends Are Shifting… Keep Reading To Find Out How They Might Make Owning A Home In Gloucester County Even Easier…
There was a time when getting a mortgage based on one’s credit score was the most frequent way to buy a home, but these more conventional approaches to buying a house are becoming far less common than they were few decades ago. The American Dream is shifting and the concept of home ownership (while still strong) is evolving…
In light of the fact that banks are becoming more stringent with their loan approval process and that Americans are still working their way out of the recession (and maybe any credit troubles they may have fallen into during the crisis), it is becoming increasingly difficult to obtain a loan.), the pros and cons of rent to own Housing has many turning to alternative means of purchasing a home…
..Maybe it’s because they don’t have the credit to use, maybe it’s because they don’t trust banks as much as they used to, or maybe it’s even because they’re learning that there are alternative methods to make purchases.
The number of people renting apartments and houses has increased dramatically over the past few years… and renting-to-own a house, which many people refer to as a lease option, has become a popular way for families to buy a local house directly from a seller (after a rental period that typically lasts between 12 and 24 months), without the rigorous qualification process offered by banks.
There are many pros and cons of rent to own housing in Gloucester County New Jersey, which we will outline in this article.
Remember to read each detail of any contract that you sign, and consult with a financial advisor or rent-to-own expert if you have any questions, or if any part of the process is confusing to you.
Pros of Rent to Own Housing in Gloucester County New Jersey — Why It Can Be A Better Option
Easier Qualification
The largest hurdle to home ownership is usually qualifying for a loan for the house.
Since the economic downturn, lenders have been increasingly picky about the income and asset requirements necessary to approve a loan. Given the current situation of the economy, however, many people in the United States are simply unable to live up to these excessive expectations. In a rent-to-own arrangement, the seller is the one who decides the criteria for approving the contract; as a result, they are typically far more flexible in this regard than conventional financial institutions.
You also won’t have to go through the laborious process of trying to qualify for a mortgage from a traditional financial institution, which will result in a down payment that is typically much less than the standard amount.
Time to Improve Your Credit
You will have the opportunity (often between one and five years) to rehabilitate your credit rating while you are renting to own a home. This will enable you to obtain a home loan to buy that house when the rent to own / lease option agreement comes to an end.
You will have the option to live in your future home while you work on improving your credit rating, and when the term has ended, you will have both saved a down payment and hopefully improved your credit rating to the point where you can receive a conventional mortgage from a bank.
Cons of Rent to Own Housing – Some Drawbacks
Rent Can be More Costly
When a home is offered on a rent-to-own basis, the seller has the ability to set a higher monthly rental rate because the tenant also has the opportunity to buy the property at some point in the future. This practice is common not only in Gloucester County but also throughout New Jersey. If a buyer is unable to purchase the property at the conclusion of the term, they will have paid more money to live in a home but will not have had the opportunity to own it.
You need to be very certain that you intend to purchase this house at the conclusion of the rent-to-own arrangement; otherwise, you would be better off simply renting a house through the standard rental channels. If you are certain that you intend to purchase this house, then you can proceed with the rent-to-own deal.
Lease Cancellation
When contemplating the purchase of a rent-to-own house, prospective purchasers need to be aware of the dangers associated with lease cancellation, eviction, and other considerations. If a buyer is late on payments or breaks the lease in any manner, the option to purchase the home may be lost, and the buyer will have forfeited all fees and additional rent that they have paid for the ability to purchase the property at the conclusion of the term.
If you want to rent to buy the property, you need to take it seriously and view it as an opportunity to build your credit and work your way into a fantastic home that you’d be proud to call your own. This is the same situation as the first disadvantage, therefore the same advice applies here as well.
There are a good number of people living in Gloucester County and Philadelphia who are unable to obtain a conventional mortgage from a bank in order to purchase a home. The Pros and Cons of Rent to Own Housing In Gloucester County are clear cut.
If you don’t have the credit or don’t have a huge down payment… but want to experience the feeling of “ownership” while you work on purchasing that house… looking for great rent to own houses in Gloucester County may be the preferable choice.
If you’re not fully committed to improving your financial situation, your credit, etc… doing a rent to own may not be the right fit.
Rent to own is an attractive option for many Americans. By knowing what you’re getting into, you have a prime opportunity to buy your dream home without meeting the often unrealistic standards set by traditional mortgage lenders.
Have Questions On How Our Local Rent To Own Program Works?
If you have questions about the rent to own / lease option process works… we’re here for ya!
Just click the link below to see our available properties… or connect with us by calling us at (856) 265-7657 or through our contact page on this website.